At the beginning of the year, the stockholders\' equity section of the balance s

Question

At the beginning of the year, the stockholders' equity section of the balance sheet of Solutions Corporation reflected the following: Common stock (S14 par value; 75,000 shares authorized, 33,000 shares outstanding) Additional paid-in capital Retained eanings 462,000 120,000 753,000 On February 1, the board of directors declared a 65 percent stock dividend to be issued April 30. The market value of the stock on February 1 was $17 per share. The market value of the stock on April 30 was $18 per share. Required: 1. For comparative purposes, prepare the stockholders' equity section of the balance sheet (a) immediately before the stock dividend and (b) immediately after the stock dividend. SOLUTIONS CORPORATION Balance Sheet (Partial) At February 1, This Year Stockholders' Equity Before Stock Dividend After Stock Dividend Contributed Capital: Common stock Additional paid-in capital Retained eanings Total stockholders' equity

Explanation / Answer

Stockholders' Equity Before stock dividend After stock dividend Contributed capital: Common stock 462000 762300 Additional paid in capital 120000 120000 Retained earnings 753000 452700 Total stockholders' equity 1335000 1335000

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